"… When it is evening, ye say, It will be fair weather: for the sky is red. And in the morning, It will be foul weather to-day: for the sky is red and lowering. O ye hypocrites, ye can discern the face of the sky; but can ye not discern the signs of the times?" The Holy Bible
"Many a so-called wise economist ... had not studied past history enough to know that after the greatest advance in history had culminated … the greatest panic in history must follow ... " W. D. Gann

Monday, February 28, 2011

House speaker urges spending cuts before nation goes broke: John Boehner addresses religious broadcasters meeting in Nashville. (The Tennessean) Speaker Boehner: National Debt Level Is Immoral (National Public Radio blogs) Remarks by House Speaker John Boehner to the National Religious Broadcasters Convention, as provided by his office (The Los Angeles Times blogs)

"The Financial Industry Has Become So Politically Powerful That It Is Able To Inhibit the Normal Process of Justice And Law Enforcement" (Washington's Blog) Inside Job - Oscar winner acceptance speech (Youtube)

A Higher Percentage of Americans Believed in King George During the Revolutionary War than Believe in Congress Today (Washington's Blog) (Youtube)

Great Recession has caused profound changes by Colin Read, professor of economics and finance and former dean of the School of Business and Economics at SUNY Plattsburgh (The Press-Republican of Plattsburgh [NY])

Saturday, February 26, 2011

Still-fragile world economy braced for effects of another oil shock: Indebted households have already tightened belts. Higher petrol costs are likely to depress demand and prices – just what the recovery doesn't need (The Observer) U.S. economic recovery threatened by events in Midwest, Middle East (The Washington Post) Number of the Week: Gasoline Prices Bite (The Wall Street Journal blogs) 10 Ways Rising Oil Prices Will Endanger the U.S. Recovery (The Atlantic)

Leading Indicators of Revolt in the Middle East and Northern Africa: Corruption, Unemployment and Percentage of Household Money Spent on Food (The Big Picture blog) Celente: “When the money stops flowing down to the man in the street, the blood starts flowing in the streets.” (SHTFPlan)

Friday, February 25, 2011

"My own view is that global recovery is more fragile than it looks. The West is still on government life-support, and the great debt unwind purge has not yet run its course. It faces a globalized 'Japan syndrome', with deflationary pungi pits waiting to catch us." -- Journalist Ambrose Evans-Pritchard (The Telegraph)

Shutdown: Washington gets ready [for March 5 deadline] (CNN) A Government Shutdown Might Not Shut Down Government (CNBC) How Much Gets Shuttered In A Shutdown? (National Public Radio) [However ...] G.O.P. Stopgap May Avert Federal Shutdown [at least until March 18] (The New York Times)

UK GDP figure revised down further: The UK economy shrank by more than previously thought during the last three months of 2010, revised figures show. (The BBC)

Saudi ruler offers $36bn to stave off uprising amid warning oil price could double: The king of Saudi Arabia last night announced $36bn (£22bn) of extra benefits for his people in an attempt to stop the wave of Arab uprisings spreading to the world’s biggest oil exporter, as experts warned Brent crude could hit $220 a barrel. (The Telegraph)

According to Linda Duessel, a market strategist at Federated Investors in Pittsburgh, quoted here, a recovery would be indicated by initial jobless claims below 500,000.

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"There were 391,000 initial jobless claims filed in the week ended Feb. 19, the Labor Department said Thursday. That was down 22,000 from the week before, and better than the 410,000 claims economists surveyed by Briefing.com had expected." (CNN)

... Lowest Level Since July 2008 -- "Still, as The Associated Press writes, jobless claims 'need to dip consistently to 375,000 or below to indicate a significant decline in the unemployment rate.'" (National Public Radio)

Wednesday, February 23, 2011

Oil briefly hits $100 - highest since 2008 (CNN) Oil price shock: Pandora's Box is opened: The last time the oil price lost all sense of gravity, as it threatens to again with the price of Brent crude now well north of $100 a barrel, it helped tip the world economy into the deepest recession since the 1930s. (The Telegraph) IEA Chief: $100 Oil 'Very, Very Bad' for Economy (CNBC) Oil Causing a Deflationary Spiral? (Cliff Küle's Notes blog) "A long period of high oil prices would sink the world’s economies and plunge the fragile global economy back into recession, said Nobuo Tanaka, chief of the International Energy Agency, a policy adviser to Western countries. 'If $100 continues through 2011 – we call it the oil burden – this will create the same level of crisis as in 2008,' Mr. Tanaka told Reuters in an interview." (The Globe and Mail of Toronto) Rising Oil Prices Raise the Specter of a Double Dip (The Wall Street Journal)

Oil could hit $220 a barrel on Libya and Algeria fears, warns Nomura: Libya's descent into civil war has led to drastic cuts in oil shipments and prompted warnings that an escalation of the crisis could see Brent crude prices double to $220 a barrel. (The Telegraph)

If The Mountain Will Not Come To The Muhammad, The Revolution Will Come To Saudi Arabia On March 20 (ZeroHedge blog) Middle East unrest: Saudi and Bahraini kings offer concessions: Attempts to ease tensions are made in Saudi Arabia, Bahrain, Yemen and Jordan, while Iran's president, Mahmoud Ahmadinejad, hits out at Libya's 'grotesque' use of force (The Guardian)

Saudi Arabia Uprising Could Mean $140-Plus Oil (CNBC) Prepare now for a Saudi oil price shock by Michael Levi of the Council on Foreign Relations (The Financial Times)

Tuesday, February 22, 2011

"While there is little danger of any country cutting off the oil supplies that generate vital revenues, there is a risk that the [current Middle East] turmoil will slow desperately needed exploration and investment. ... The mid-decade crunch is looking ever more certain." (The Telegraph)

OPEC Oil Exports Fall 2% as Saudi Shipments Decline (Bloomberg) You're Dreaming If You Think OPEC Can Boost Oil Production At Will (The Business Insider)

EU may consider extending Greece's three-year bailout term, says Merkel -- "'I see a general opinion now that Greece will not be able to service its debt,' said Prof Hans-Werner Sinn, head of Germany’s IFO research institute ..." (The Irish Times)

Home prices fall to lowest level since housing bust in most major US cities (The Associated Press) (The New York Times) (CNN) If You Live In One Of These 11 Cities [Atlanta, Charlotte, Chicago, Detroit, Las Vegas, Miami, New York, Phoenix, Portland, Seattle and Tampa], Your Home Just Hit A New Low (The Business Insider)

Monday, February 21, 2011

Merkel's CDU Loses Power in Hamburg, Suffers Worst Postwar Defeat in State (Bloomberg) Hard-working Germany in driver's seat handling Europe debt crisis (The Montreal Gazette) Germans are about to discover what it feels like to be mugged by the EMU project (The Telegraph blogs) [Meanwhile...] Papandreou Urges Merkel to Support Debt Buybacks, Flexible Bailout Fund (Bloomberg)

Oil shock fears as Libya erupts: The spectre of full civil war in oil-rich Libya and reports of the creation of an Islamic emirate in country's "Barqa" region has moved the Mid-East crisis into a more dangerous phase, setting off an explosive rise in US crude prices. (The Telegraph) Qaddafi’s Forces Strike With Fury as Unrest Grows (The New York Times)

Libya on the brink: As Secretary of State Clinton condemned the violence in Libya on Monday, anti-government protestors called for another night of defiance in Tripoli amid reports that Libyan security forces are preparing for a major assault. NBC's Ron Allen reports. VIDEO @ (NBC Nightly News)

Friday, February 18, 2011

Bahrain killings bring Mid-East turmoil to epicentre of world oil supply: Escalating violence in the oil states of the Persian Gulf and North Africa have pushed Brent crude prices to a 30-month high of $104 a barrel, and raised widespread concerns over the stability of global oil supplies for the first time since the Mid-East turmoil began. (The Telegraph) Saudi Prince Says Protests May Move to Kingdom, BBC Arabic Says (Bloomberg)

Public Employees in Fierce Budget Debate: Wisconsin is battleground over public workers and cash-poor states. (ABC News) Republicans Target Unions Across State Capitols (The Associated Press)

Wisconsin Public Workers Union Rights Go Head-to-Head with State Budget Woes: A push to reduce state workers' benefits and eliminate collective bargaining caused a furor this week as protesters descended on Wisconsin's Capitol. Judy Woodruff examines the predicament with Jonathan Williams of the American Legislative Exchange Council and Randi Weingarten of the American Federation of Teachers. (PBS NewsHour) (Youtube)

A tipping point for labor in America: It may not be overstating the case to say that the future of organized labor as a whole may turn on the willingness of public sector unions to make statesmanlike, farsighted concessions now. (The Los Angeles Times)

Borders Group files for bankruptcy reorganization: The bookseller, struggling with poor sales and heavy debt, will close about 200 stores — including 35 in California — and lay off about 6,000 workers. (The Los Angeles Times) Borders’ Bankruptcy Shakes Industry (The New York Times)

Housing Starts Way Up, But Permits Way Down in January (The Atlantic) Homebuilders have grim view of housing market (The Associated Press) U.S. Mortgage Demand Falls to Two-Year Low as Refinancing Drops (Bloomberg)

What Big Oil Discusses Behind Doors ["energy supplies will be so tight that they will tip the world into a full-blown crisis"] (Cliff Küle's Notes blog) Peak Oil Is Real But The "Paper Barrels" Of Arab Countries Are Not (The Business Insider)

Monday, February 14, 2011

Obama tests bond markets with mega-deficits: US President Barack Obama faces a stiff battle with Republican foes in Congress after unveiling plans for $7.2 trillion (£4.5 trillion) of deficit spending over the next decade, and making little attempt to control the spiralling costs of social security and medical entitlements. (The Telegraph) Notably Absent from Obama's Budget: Deficit Commission Recommendations (FoxNews blogs) Obama Proposing Record Budget Deficits; Is America Doomed to Follow Greece? (The Huffington Post blog)

Sunday, February 13, 2011

Japan Economy Shrinks, First Contraction in 5 Quarters (Reuters) Japan: Economy slips to third in world (CNN)

Obama to set out painful budget plans for austerity in America (The Independent) Geithner Quietly Tells Obama Debt Expense to Increase to Record (Bloomberg) Obama budget to cut deficit by $1.1 trillion (Reuters) Could the growing U.S. debt create a financial crisis? (The Richmond Times-Dispatch)

Thursday, February 10, 2011

European debt crisis threatens Portugal: Portugal becomes latest eurozone member to be threatened by speculative attacks in the bond markets as borrowing costs soar (The Guardian) Portuguese bond yields hit record on debt worries (Reuters) Portugal defiant as borrowing costs rise: Portugal has denied it will struggle to raise capital from international investors after yields on Portuguese government debt hit record highs. (The BBC)

Spain orders drastic caja clean-up to win confidence and fight off EMU debt contagion: Spain has imposed draconian rules on its saving banks and is preparing for part-nationalisation of the industry to restore confidence and boost the country’s defences against contagion from the debt crisis in Portugal. (The Telegraph) Spain's cajas may struggle to find investors - poll (Reuters)

According to Linda Duessel, a market strategist at Federated Investors in Pittsburgh, quoted here, a recovery would be indicated by initial jobless claims below 500,000.

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

First-time unemployment claims lowest since July 2008: Applications fell last week to a seasonally adjusted 383,000, reinforcing confidence that the labor market is on track to recovery. (The Los Angeles Times)

"'These data have been sort of distorted by weather and various statistical clouds over the last 8 weeks, but it looks like new jobless claims are trending lower,' said Zach Pandl, an economist with Nomura." (CNN)

Wednesday, February 9, 2011

"In layman terms, what the Guardian is reporting is that when the price of oil becomes too expensive, the Saudis have produced more, adding more supply to keep prices steady. If Saudi Arabia has in fact reached 'peak oil,' which this report argues it has, it means the Saudis couldn't tap more oil and the prices of crude would jump permanently." (National Public Radio blogs)

Tuesday, February 8, 2011

"The entire global banking system is technically bankrupt. There is $40 trillion in U.S. denominated debt that cannot possibly be paid back. European banks are in no better shape. That is what the sovereign debt crisis in Europe is all about. Look at Japan. It has a debt-to-GDP ratio of 200%. Yet, Japan’s demographics could not be worse. The Japanese people were savers, but the government squandered it all and 100% more in foolish efforts to defeat deflation. The U.S. is making the same mistake." -- Mish Shedlock, SitkaPacific Capital Management (Cliff Küle's Notes blog)

Did WikiLeaks Confirm "Peak Oil"?: Saudi Said To Have Overstated Crude Oil Reserves By 300 Billion Barrels (40%) (ZeroHedge blog) WikiLeaks cables: Saudi Arabia cannot pump enough oil to keep a lid on prices: US diplomat convinced by Saudi expert that reserves of world's biggest oil exporter have been overstated by nearly 40% (The Guardian) Saudi oil company oversold ability to increase production, embassy told [2007-12-10] (The Guardian) US concern over Saudi Arabia oil production [2008-05-07] (The Guardian) US queries Saudi Arabia's influence over oil prices [2008-06-03] (The Guardian) Saudi Arabia tackles western shift towards energy independence [2009-11-23] (The Guardian) "As we said in our Al Jazeera English film 3 years ago, Saudi Arabia has been lying BIG TIME about their reserves. A 40% drop would correspond to what we’ve seen in the other two ‘super fields’ in Kuwait and Mexico. The era of cheap oil if finished. We hit Peak Oil (and Peak Credit) in 2007." (MaxKeiser.com)

Friday, February 4, 2011

Jobs Report Offers a Mixed Bag, but Little Comfort (The New York Times) What Clues Does 'Strange' Unemployment Report Hold?: January unemployment numbers sent mixed signals for economic recovery. The jobless rate dipped to 9 percent, but a survey of businesses found only a net gain of 36,000 jobs last month. Jeffrey Brown assesses those numbers with New York Times economic reporter David Leonhardt. (PBS NewsHour) (Youtube)

BofA creates new unit, names foreclosure czar: Creation of a division to oversee problem home loans indicates that Bank of America, the largest U.S. mortgage servicer, is attempting to be more aggressive in resolving its portfolio of troubled loans. -- "'This is a significant step. If Bank of America has these issues, what kind of problems does everyone else have?' said Matt McCormick, a Cincinnati-based portfolio manager at Bahl & Gaynor Investment Counsel Inc." (The Los Angeles Times)

U.S. closes three banks, 14 failures so far in 2011 (Reuters) American Trust Bank of Roswell GA had a troubled assets ratio of 571.2%. (BankTracker) Community First Bank Chicago of Chicago IL had a troubled assets ratio of 207.8%. (BankTracker) North Georgia Bank of Watkinsville GA had a troubled assets ratio of 752.3%. (BankTracker)

According to Linda Duessel, a market strategist at Federated Investors in Pittsburgh, quoted here, a recovery would be indicated by initial jobless claims below 500,000.

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"New applications for U.S. unemployment benefits tumbled last week by 42,000 to 415,000, the Labor Department reported Thursday, although claims are still at levels associated with a frail jobs market." (Marketwatch)

"'(Claims) were around expectations, but really everybody now wants to see this thing below 400,000. For a while it was 450,000 -- we were stuck around 450,000 but now everybody wants to see it below 400,000. Hey, it's an improvement, it's getting better, but not quite as fast as we'd all like it.'" (Reuters)

IMF raises spectre of civil wars as global inequalities worsen: The International Monetary Fund (IMF) has warned that "dangerous" imbalances have emerged that threaten to derail global recovery and stoke tensions that may ultimately set off civil wars in deeply unequal countries. (The Telegraph)